In a key breakthrough witnessed across the aviation sector, the federal government of Canada has decided to scrap its purchase deal with Boeing subject to its trade war with Bombardier Inc., an aerospace firm based in Canada. It has been reported that the defense ministry of Canada now intends to replace the Boeing aircraft purchase with another deal – the plan is to import of thirty second-hand fighter planes from Australia. The move, it is stated, may strain Canada’s relations with Boeing.
As per the reports, the U.S. commerce department had imposed import tariffs of nearly 300% on C Series aircrafts ruling in favor of Boeing. It is anticipated that the legal proceeding will continue next year, and the total amount of the new import duties will be finalized by 2018. Sources have claimed that Canada will pursue a case challenging the U.S. government’s decision to levy import taxes on Bombardier C Series Plane sale to Delta Airlines at World Trade Organization. Canada and Britain, both of which supported the entry of Bombardier’s C Series aircrafts in the U.S. aerospace sector, have reportedly been critical of import duties levied by the U.S. government.
Reacting to the Canadian government’s decision to purchase Australian fighter planes, the chief official of Boeing stated that the move could affect not only its USD 4 billion business with the country, but can also impact the employment situation across the region. Industry analysts have claimed the move by the Canadian government to be retaliatory in nature as the Prime Minister had declared the decision of discontinuing relations with Boeing until the complete resolution of latter’s business conflict with Bombardier.
The key officials of Bombardier have stated that the U.S. government’s decision to levy heavy custom duties will have adverse consequences on the development of the global aerospace sector.